Oil prices bounced back Thursday but remain near lows of the year, despite concerns about the volatile situation in the Middle East and the impact of a stronger dollar. Bobbi Rebell reports.
Global oil prices took a break from their downward trend Thursday- climbing back after hitting two year lows. Supplies are mounting, and demand is weakening, despite concerns that conflicts in the Middle East and other areas of the world could curb oil production. Brown Brothers Harriman's Marc Chandler: SOUNDBITE: MARC CHANDLER, HEAD OF GLOBAL CURRENCY STRATEGY (ENGLISH) SAYING: "Oil prices are falling, I think partly because the Saudi's are producing a lot of oil, making up for what we've lost in other countries. Libya is coming back on line, and of course the U.S. is producing more oil, more energy than it has for about 30 years." U.S. Light Sweet Crude recently hitting lows near $90 a barrel, down about 12 percent from late July, though regaining some ground on Thursday. The International Energy Agency or IEA in its monthly report saying slowing economic growth, especially in China and Europe, is curbing oil demand, overriding concerns about the Middle East: The IEA cutting its oil demand growth projections for this year and next. Platt's John Kingston: SOUNDBITE: JOHN KINGSTON, DIRECTOR OF NEWS, PLATT'S (ENGLISH) SAYING: "Let's not forget the Iranian sanctions which have significantly cut back that country's output, and even though the I.S. rebels are not in control of main oil producing areas, they do have some, there is some production loss that you can attribute to the problems in Iraq. However it's been the U.S. and Canada to the rescue. U.S. production continues to blow by all forecasts. Canadian too as well." But the lower oil prices- are a positive for the consumer driven U.S. economy. David Rosenberg, Chief Economist, Gluskin Sheff & Associates. SOUNDBITE: DAVID ROSENBERG, CHIEF ECONOMIST, GLUSKIN SHEFF AND ASSOCIATES (ENGLISH) SAYING: "We have 17.5 million auto sales they are at cycle highs so we are inheriting actually a big source of stimulus because of Libyan production coming back onstream, global oil production coming in stronger than expected so actually this is a source of really, it widens profit margins for a lot of U.S. companies in so far as it means prices at the pump go down, it puts more money in people's pockets to spend somewhere else." Welcome news that will travel well beyond the gas pump.